Doctor Pay Drives Rising Health Care Costs: Study

   on September 08 2011 11:22 AM
At Issue: U.S. Health Care Policy
A new study uncovers the link between U.S. high health care costs and doctor fees. REUTERS

A new study has identified a major culprit for the astronomical cost of health care in the United States: doctors who are charging higher fees than their counterparts in many other countries.

Conducted by two Columbia professors, one of whom is now a high-ranking health official in the Obama administration, concluded that primary care doctors and orthopedic surgeons earned an average of $187,000 and $442,000, respectively, in 2008 -- substantially more than doctors in other countries. That seemed to stem from charging higher fees, not from seeing more patients or using more expensive treatment.

American primary care and orthopedic physicians are paid more for each service than are their counterparts in Australia, Canada, France, Germany and the United Kingdom, the study read.

U.S. Private Health Insurance Plans Pay Doctors a High Amount

While there was a smaller discrepancy between the size of payments doctors received from Medicare versus from public insurance plans in other countries, private insurance plans in the U.S. paid doctors the most of any country studied.

U.S. primary care physicians earn about one-third more than do their counterparts elsewhere, largely because a much larger share of their incomes is derived from private insurance, the study said.

The study also found that American doctors who specialize in a certain field make far more money than primary care physicians, with the gap between primary care physicians and orthopedic surgeons larger in the United States than anywhere else.

In the United States, primary care doctors earned only about 42 percent as much as orthopedic surgeons earned, the study said. In Canada, France and Germany, in contrast, primary care doctors earned at least 60 percent as much as orthopedic surgeons earned.

The authors argued that the high cost of medical school in the United States does not explain why American doctors earn more.

Although the tuition cost of medical education in the United States borne by individuals is substantial, it cannot fully account for the observed differences between the earnings of U.S. physicians and physicians in all other countries, the authors wrote.

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